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MTI profiteers could be asked to pay back the money

Criminal case opened. Liquidators will have to track down thousands of investors using nothing more than emails.
Image: Chris Ratcliffe/Bloomberg

The Financial Sector Conduct Authority (FSCA) has completed its investigation into Mirror Trading International (MTI). The bad news for many MTI investors who received payouts from the bitcoin investment scheme is that they may be asked to pay back the money.

Bitcoin investment scheme MTI collapsed in December after raking in an estimated 23 000 bitcoin worth R13.3 billion from thousands of investors around the world.

Head of enforcement at the FSCA, Brandon Topham, says the authority will first share its report with recently-appointed liquidators, which should assist them in their recovery of funds.

“The FSCA understands that the liquidators are of the view that the funds or assets received by certain members of the public pursuant to investing with MTI, may be unlawful,” read a statement by the authority released on Tuesday.

“The liquidators intend to recover such funds and assets from these investors – a course of action that the FSCA supports. Affected investors are requested to contact the liquidators in this regard.

“Although the main FSCA investigation has been completed, the authority has opened a criminal case with the Commercial Crime Unit and will assist the NPA (National Prosecuting Authority) with its responsibilities. It will also assist the liquidators in their extensive task of completing the liquidation and subsequent distributions. The authority is also working with foreign regulators to ensure that MTI’s unlawful activities are not perpetuated in other jurisdictions.

“The FSCA will now consider administrative actions to be taken against the individuals and entities involved in the matter.”

Successful strategy

MTI was structured as a multi-level marketing scheme that rewarded members for signing up new investors, for which they could earn 10% commissions on sums invested. MTI was astonishingly successful at attracting new investors, even after repeated warnings by the FSCA to steer clear of the company and its promises of returns.

Read:
FSCA investigating Mirror Trading International (Aug 19, 2020)
Get-rich-quick scheme pulls a crowd, despite regulators calling time-out (Aug 28, 2020)

The MTI database was recently hacked by Anonymous ZA and, if accurate, appears to show some outrageous returns being earned by the founders of the scheme. The lead earner managed to accumulate more than R100 million by building a massive downline numbering thousands of members, on which he was able to earn commissions. Another lead member started with $100 in April 2019 and ended up making R37 million 20 months later.

Investors, come clean

Topham advises those who earned money through MTI to voluntarily contact the liquidators and provide details about their earnings, rather than wait for the liquidators to track them down.

The task is complicated by the fact that the only contact for many members is an email address. It is likely that the liquidators will concentrate on big hitters who earned large returns through the scheme.

Given the 280 000 members who signed up for the scheme, the liquidators have a huge task ahead of them to track them all down. Not all of these are likely to be genuine accounts. One investigator told Moneyweb that many of these accounts were opened in the name of fictitious people, including family pets, in order to earn additional commissions.

Liquidation

MTI was placed in provisional liquidation earlier this month after investors reported that they were unable to make withdrawals, thereby committing an act of insolvency.

Read:
Liquidators swarm MTI (Dec 23)
MTI placed in provisional liquidation and damage could be huge (Dec 29)
MTI: Provisional liquidators appointed (Jan 13)

The appointed liquidators are Mr. AW van Rooyen (Investrust Insolvency Practitioners), Mr. H Bester (Tygerberg Trustees), Mrs. J Barnard and Mrs. D Basson (Tshwane Trust Co).

“Anyone who intends to lodge a claim with the liquidators, or who has information that can be of assistance, may contact the liquidators through their websites. The websites will also be utilised to communicate information to the public,” says the FSCA statement.

The websites for submitting claims are: www.Tygerbergtrustees.co.za and www.Investrust.co.za.

Claim forms will be available on the website within the next few days.

Listen: Brandon Topham, FSCA divisional executive of enforcement, explains why MTI investors may lose everything

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MTI profiteers will cleverly argue that ‘crypto is not money’ , hence nothing needs to be paid back.

And how would one know? It’s not like you go and “lift the chain off a block” 😉 to view the face, ID nr & address of the wallet owner.

And just to add to that – what if the Bitcoin value tanks completely. What value does a person have to pay back???

and that is exactly the problem with Bitcoin.

All that they stole were a few data blocks. I’m sure they can pay it back with a data voucher.

Pity about no more videos hosted by Cheri Marks.
She sounded so convincing to the uninitiated, spending most of her time defending the scheme 😉

Have they ran out printing ink?

Strange, when you visit websites of commercial banks and asset managers, you won’t find arguments (be it video or written) to convince investors all the time that they’re all valid schemes.

They’re going to need lots of fabric for her orange overalls, hahaha!

Cheri Marks is probably the main culprit in the MTI mega fraud saga. She herded the sheeple into the MTI trap. Just like in her previous fraudulent scheme.

Hmmm .. yes, good luck tracking down the hotmail.com email address for Mr Bonzo. Where is the perpetrator of this scene now?

And may I once again correct the writer in describing this operation as an “investment” while everyone knows it was a “speculation”.

I know it is socially unacceptable to feel the way I feel after reading this article, but there is some form of satisfaction when the gears start to turn against those who said all those hurtful things when they were called out for being what they were i.e. a pyramid scheme. My suggestion to find these people would be to pull up the MTI articles on Moneyweb and look at the comments section, you will soon find the people that invested with MTI.

Ha haa! you are absolutely right….

Germans have a word for the way you feel “schadenfreude”.

If investors will have to pay back profits they received then would the other investors who lost they money get paid back – ?? huh

Its a criminal case. Where is the crack team of SAPS and FSCA to do the tracking and enforcement? The liquidators are represented by certain investors, some of them who are early investors themselves, the conflicts of interest here are enormous. This sounds like the “bussiness rescue” racket. No word back from the Brazilian embassy regarding Johann Steynberg?? Lol of course not.

The only winner in this little scam and scheme of arrangement will be the liquidators. Find the culprits and notify the world where they are hiding out so that the aggrieved parties can arrange a hit squad for retribution

Investors? Nope. Morons

I always wonder if these investors are not in someway aware, in the “back of there heads ” that they are investing in some sort of ” scheme”?….they can’t be that ignorant? rather greedy!

@Chev.
I concur. I think 99% of the MTI ‘supporter/defenders KNEW EXACTLY they were involved in a Ponzi, and just “playing the system” to see if they can enter earlier into the scheme, rather than near the end.

Obviously, they all kept hush by stating MTI was all valid, and they did their research (yeah right!)…their idea is to try and promote this ponzi under MW commentators, so that the scheme can run a bit longer & then they can recover their capital & try to timely exit.

Otherwise, it would be an insult to their IQ. They KNEW the game. But the audacity to blatantly defend it months ago, irks me.

and they were forewarned multiple times.

As per usual with these situations, after everything that has been lost the liquidators swoop in and their fee gobbles up every last little remaining bit.

Who remotely thought it was a good idea to send bitcoin to a scheme… There’s almost no traceability… Play stupid games, win stupid prizes.

There’s a saying that if you give yourself out to be a toffee, your going to get chewed.

Best the Bitcoin investors don’t lose their account passwords.

No thank you. Too busy enjoying the pandemic

Bitcoin is one big ponzi scheme? What else.

One question.

They want money paid back from “investors” that withdrew money from MTI.

Did the FSCA not ask “Investors” to do just that?? Withdraw their money??

This just seems like a nice BIG mess.

Enjoying every minute.

I agree, Mmmm.

The FSCA warned everyone long ago, yet got ignored. The FSCA should just let it go & allow people to learn the hard way. MTI is doing us anti-ponzi camp (that warned others against MTI) a nice favour….pain is the best learning school.

The FSCA should just do a short “Dear John sorry letter” to all investors, and close it of with a “Virtually Yours” greeting.

😉

I mean, WHO lambasted the FSCA not to get involved, because crypto supposedly falls outside the FSCA’s scope? The same losers now DEMANDING the regulator to get involved. Ha-ha…they want their cake and eat it!

Hindsight is always 20/20. Oneday we may all be saying the same about all the people who bought Bitcoin et al. That ‘how could people not have seen that it’s all pie in the sky’…

Well, for me, the first time I came across MTI’s presentations (and subsequent research on the web) I NEVER NEEDED 20/20 hindsight….it was screaming “ponzi” right from the start! *lol*

I mean, it’s EASY with plenty of upfront warning: ….first my computer’s malware alarm went haywire; my crypto sonar picked up hostile pings; and my missile-warning radar whined all the time when I researched MTI. Electronic countermeasures (ECM) audio blaring crazy in my headset…and red lights flashing.

Don’t tell me you missed it?

No no, I don’t do nonsense like this. My point was more that people are similarly blind to the hype around crypto currencies.

maybe clients should claim against the FSCA for not doing their job…..add the Ecsponent clients.

Remember in the financial markets in the time of the euphoria people stop listening to reason. It’s as if the rules don’t apply anymore, and that is when greed and fomo take over and then when the bubble bursts, that’s when most people get hurt.

Could it be that the car hi jacking industry suffers from the very same discrimination ?

End of comments.

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